risk aversion

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Related to CARA utility: Risk aversion

risk aversion

n
a strong disinclination to take risks
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References in periodicals archive ?
over all X [member of] X([x.sub.i], T), the collection [X.sup.*.sub.1], ..., [X.sup.*.sub.n] is defined by a Nash equilibrium for CARA utility maximization.
We will prove that the Nash equilibrium of mean-variance optimization is the CARA utility optimization.
Risk and probability premiums for CARA utility functions.
Similarly, the section after that compares [??](W) with a(Y) for CARA utility.
An advantage of the CARA utility function is that many commonly used utility functions are convex combinations of CARA utility functions (Brockett and Golden, 1987; Thistle, 1993).
One seemingly restrictive assumption in this model is that each individual has a CARA utility function.
However, risk premiums are independent on wealth when restricted to the class of CARA utility functions(3), and thus: (4) V = CE ([d|.sub.y.sup.*]) - CE ([d.sup.*])